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Trust talks $3.2 billion securities tied to T-Mobile to yield 5.25%-5.75%, up 17.5%-22.5%
By Abigail W. Adams
Portland, Me., June 22 –The 2020 Cash Mandatory Exchangeable Trust plans to price up to $3.2 billion par-of-$1,000 three-year cash-settled mandatory securities tied to T-Mobile US, Inc. after the market close on Tuesday with price talk for a dividend of 5.25% to 5.75% and a threshold appreciation premium of 17.5% to 22.5%, according to a market source.
Goldman Sachs & Co. LLC is lead left bookrunner for the Rule 144A offering.
Morgan Stanley & Co. LLC, Citigroup Global Markets Inc, J.P. Morgan Securities LLC, Barclays, BofA Securities, Inc., Deutsche Bank Securities Inc. and Mizuho Securities USA Inc. are also joint bookrunners.
The $3.2 billion offering includes a 7.5% greenshoe.
The securities are non-callable and have no put options. There is standard dividend protection.
Concurrently with the trust securities, T-Mobile is pricing a secondary offering of 133,548,303 shares.
Net proceeds from the common stock offering will be used by T-Mobile to repurchase an equal number of shares from a SoftBank subsidiary, according to a 424B5 filing with the Securities and Exchange Commission.
There will also be a rights offering.
T-Mobile plans to repurchase 19.75 million shares held by SoftBank. Shareholders of record as of June 25 will receive the right to purchase 0.05 share of common stock at the same price per share as the secondary offering.
Proceeds from the exchangeable trust offering will go to SoftBank Group Corp. with the securities part of SoftBank’s efforts to monetize a portion of its stake in T-Mobile.
Following the offering, T-Mobile parent company Deutsche Telekom AG will hold 43.5% and SoftBank will hold 8.6% of T-Mobile common stock.
SoftBank is a Tokyo-based multinational conglomerate holding company.
T-Mobile is a Bonn, Germany-based telecommunications company.
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